Textures with transparencies

Hey guys, I'm trying to use a partly transparent texture to make a pommel ring, like I know I've seen in some models, but I'm having trouble.

The data that makes textures appear transparent in Blender (2.68) doesn't seem to be exported to .mesh, the thing is, I went to check the
mesh in GUTS anyways, and when the item is dropped on the floor it looks alright, but not when the character is wielding it.